Q3 Results April to December
2008/09

Agenda1. Business Review
2. Recession Management
3. Financial Review
4. Outlook

2February 10, 2009

1. About LEM•

LEM is the global market leader in providing innovative and high quality
solutions for measuring electrical parameters•

The current and voltage transducers are used in a broad range of applicationsin industrial, traction, energy & automation and automotive markets•LEM is listed on the SIX Swiss Exchange since 1986
Market cap of CHF 160 million

3February 10, 2009

1. LEM Production & Logistics World-WideProduction Centers:
Geneva, Switzerland
Beijing, China
Tokyo, Japan
February 10, 2009

290 employees
360 employees
90 employees

Adaptation Centers:
Milwaukee, USA
20 employees
Tver, Russia
90 employees
41. Highlights YTD Q3 2008/09• Sales increased by 5.1% to CHF 156 million– at constant exchange rates +9.0%• Operational EBIT reached CHF 25.4 million (CHF 27.0 million)• EBIT increased by 43.5% to CHF 30.4 million (SOP effect)• Net Earnings increased by 48.4% to CHF 21.6 million• LEM is impacted by the recession starting in Q3• Restructuring measures were taken to adjust the capacity and costbase to the weak market as of November 2008

5February 10, 2009

Sales in CHF millions

1. Net Sales
CHF millions

Sales

GrowthAt constantexch.rate

Total Sales

156.1

5.1%

+9.0%

Industrial

143.8

8.1%

+12.0%

Automotive

12.4-20.5%-16.3%

Effect of currencies:
EUR

-2.0%

USD

-1.7%

Others

-0.2%

6February 10, 2009

1. Industrial Segment: Regional Markets
Sales growth YTD Q3:• Total sales CHF 143.8 million for YTD Q3 2008/09
February 10, 2009••••

EuropeN. America
Asia
ROW

11.3%
1.6%
6.1%
-5.3 %•

Total growth

8.1%

7

1. Industrial Segment: Business Development

Sales in CHF millions

Market• The Industry market has grown by only
3.3% due to lower demand in power
supplies, medical, windmill and drive
applications• The Traction market performed welland increased by 22.1%• The Energy & Automation market
continued its growth with 56.4%

Applications• Industry: motor drive controls, energy
conversion and wind & solar energy• Traction: general market and energy
metering• Energy & Automation:
MacroComponents for automation
control, Wi-LEM, Battery Monitoring
February 10, 20098

1. Automotive Segment: Regional Markets
Sales growth YTD Q3:• Europe• N. America• Asia-11.8%-39.3%
21.9%•- 20.5%

Total growth• Sales CHF 12.4 million for YTD Q3 2008/09, representing 7.9% of total sales
February 10, 20099

1. Automotive Segment: Business Development

Sales in CHF millions

Market: US car manufacturers
with depressed production

Market• Poor sales of our key customers, USA
first and now also Japan• Major new design-ins for several
battery management and hybrid
projects were gainedApplications• Battery management for sedans andhybrid electric vehicles• Motor Controls for hybrids and electricvehicles

10
February 10, 2009

1. China Development YTD Q3 2008/09
Sales• Production volume increased by 85%• Continued transfer of key products• “Made by LEM” quality, site audited byseveral key customers
Sales in CHF millions

Sales in CHF millions• Sales growth of 17.6%

Production

11
February 10, 2009

2. Recession Management

2. Recession Management• Bookings started to decline in September 08• LEM tends to be in the early part of the business cycle• Order book started to decline in October 08• On November, 19, 2008 we announced a headcount reduction of 10%
to adapt to the ww economic downturn• On Feb 10, 2009 we announced a further adaptation of capacity byintroducing short time work in LGVA, like before in LJP• We have adapted capacities to the needs of today, allowing a fast
reaction to new markets and opportunities.

13February 10, 2009

2. Recession Management
Costs:• We continue to improve the cost base, mostly the external and indirect costs,
to lower the break-even point.
• SG&A to remain in the same % range to sales as before
New business opportunities are developed aggressively:• New products for the mainstream Industry market• Automotive expansion in the Asian markets• E&A market with the good progress of the Wi-LEM energy metering andBattery management components
LEM considers the recession to be longer than one year, but expects to stayprofitable and ready for a new growth phase.

14February 10, 2009

2. Recession Management
Our multiple markets approach is helping us to reduce the impact of therecession

Q3 to Q3
growth*Traction

Energy &Automation

Industry

Automotive+5.0%+13.4%-10.2%-37.4%* Comparing Q3 2008/09 to Q3 2007/08
February 10, 200915

2. Recession Management - Automotive
Automotive is impacted most by the recession, primarily in USA andJapan, where LEM has it’s major sales.
We are concentrating our focus on 2 main areas:•Battery Management with near standard transducers for most cars
– Up to now– 2009/10 year end•

1 major customer in NAFTA+1 major customer in Japan+1 major customer in NAFTAHEV – EV motor controls for the new “green cars”– Many design-ins in Asia, NAFTA and Europe, but very low volumes– Strategic position is good – however the ramp-up time remains an issue

Major cost reductions (direct and indirect) in the pipeline
16February 10, 2009

3. Financial Review

3. Profit and Loss
CHF millions

YTD Q3
2007/08

YTD Q3
2008/09

ChangeSales

148.5

156.1

+5.1%

Gross margin

67.4

69.9

Gross margin in %

45.4%

44.8%

Operating costs(40.4)(44.5)

Operational EBIT (pro forma) *27.0

25.4

SOP revaluation(5.8)

5.0

EBIT

21.2

30.4

Net financial expense0(1.3)

Income taxes

(6.7)

(7.5)

Tax rate

31.4%

25.9%

Net earnings

14.5

21.6

* Before changes in the conditions of the stock option plans (Q3 2007/08)
February 10, 2009-5.7%
+43.5%+48.4%
18

CHF millions

3. Sales by Quarter
CHFmillions

Q1

Q2

Q3

YTD
Q3

2007/08

49.9

48.6

50.0

148.5

2008/09

55.5

55.5

45.1

156.2

• Slowdown of growth in Q3 2008/09

19
February 10, 2009

3. Gross Margin Development
YTD Q3
2007/08

YTD Q3
2008/09Gr.M.

67.4

69.9

Gr.M. %

45.4%

44.8%

in CHF millions

CHF millions• Gross margin % below PY
due to lower capacity utilization20
February 10, 2009

3. Operating Expense (before SOP revaluation)
YTD Q3
2007/08

YTD Q3
2008/09

Opex

40.4

44.5

Opex % sales

27.2%

28.5%

in CHF millions

CHF millions

Operating expenses increased due to:• Build up of sales structure:– India and Energy & Automation• Tax optimization project21
February 10, 2009

in CHF millions

3. Operational EBIT
CHFmillions

Q1

Q2

Q3

YTD
Q32007/08

9.6

8.4

9.0

27.0

2008/09

12.0

9.4

4.1

25.4

• Significant drop in operational
EBIT in Q3 as a result of lowersales, reduced capacity utilizationand higher operating expenses
22February 10, 2009

in CHF millions

3. EBIT Development

CHF millions

YTD Q3
2007/08

YTD Q3
2008/09

EBIT

21.2

30.4

EBIT % sales

14.3%

19.5%

• Effect of the reversal of SOP
provisions
23February 10, 2009

3. Financial Expense

TCHF

YTD Q3
2007/08

YTD Q3
2008/09

Financial expense

(708)

(401)

Financial income

217199Exchange effect484(1’120)

Net financial expense(7)(1’322)• Unfavorable exchange effects from the translation of the balance sheet
positions in foreign currency (EUR).
February 10, 200924

CHF millions

3. Net Earnings

CHF millions

YTD Q3
2007/08

YTD Q3
2008/09

Net earnings

14.5

21.6

Net earnings% sales

9.8%

13.8%

• Improved Net earnings due to
SOP revaluation25
February 10, 2009

3. Consolidated Balance Sheet HY 2008/09
TCHF

31.09.2007

31.03.2008

31.09.2008

Cash and cash equivalents

13’22725’787

19’172

Trade debtors

37’58841’16949’442Other current assets

1’724

2’051

2’786

Inventories

26’26922’41132’847

Total non-current assets

23’402

24’541

26’960Total assets

102’210

115’959131’207

Trade payables

13’07517’03423’215

Other short-term liabilities

19’271

20’591

27’797

Total long-term liabilities

3’909

7’125

7’749

Equity65’95571’20972’446

Total liability and equity

102’210

115’959131’207• The recession puts renewed focus on trade debtors andinventory management
February 10, 200926

3. Summary• Sales increased by 5.1% to CHF 156 million– at constant exchange rates +9.0%• Operational EBIT reached CHF 25.4 million (CHF 27.0 million)• EBIT increased by 43.5% to CHF 30.4 million (SOP effect)• Net Earnings increased by 48.4% to CHF 21.6 million• High priority on working capital management

27February 10, 2009

4. Outlook

4. Market Factors and Strategy

The present recession challenges our growth strategy:– Weakness in important Industry market– Very weak market situation in Automotive– Weakness in energy savings and renewable energy
We firmly believe in our Strategic Direction• Our fast and firm reaction will make us stronger coming
out of the downturn• Our multi-market and global reach are clear benefits
29February 10, 2009

4. Innovation: 2 New Major Product Launches
New products are our investment for the future• DV is the first DC class 1 accurate voltage transducer for the Traction
market– Applications: energy metering in trains• The CAS, CASR and CKSR families are a new generation of ourmainstream products for the Industry market using a new technology– Applications: variable speed drives, UPS, air conditioning, homeappliances, solar inverters and precision systems like servo drives forwafer production and high-accuracy robots.

DVCASR
30

February 10, 2009

4. Outlook• We are able to increase our outlook statement after Q2, of November• In terms of Sales and EBIT we will remain below last years results(2007/08: sales CHF 203 million, EBIT CHF 30.3 million)• We expect a positive EBIT for the fourth quarter31
February 10, 2009

4. Share Price Development

P/E ratio was:
5.2 end Q3 08/09
19.0 end Q3 07/08
19.8 end Q3 06/07

32
February 10, 2009

4. Financial Calendar and Contact Details
Financial calendar
4 June 200926 June 2009

Full year 2008/09 results
Annual Shareholder’s Meeting

For further information
Paul Van Iseghem
President and CEO
Tel.: +41 22 706 14 09
E-mail: pvi@lem.com

Ageeth Walti
CFO
Tel: +41 22 706 12 30
Email: awa@lem.com

33February 10, 2009